A certain percentage of employment candidates who receive and accept job offers, subsequently do not join the employing organization. In other words, a percentage of the candidates renege on the acceptance of a job offer, and these candidates who do not join the organization after accepting job offers are called “Reneges.” A “Renege Rate” is then the percentage of applicants that do not join the organization after accepting a job offer. If, for example, a hundred candidates accept job offers and twenty of the same population then eventually does not join following their acceptances, the renege rate will be 20/100, or 20%.
In some industries, the renege rate can be quite significant. For example, in certain segments of the high technology service industries, the renege rate may exceed a third. A high renege significantly increases recruitment costs and efforts due to the potential need to fill the same position multiple times. The high renege rate may have other significant costs to the organization, including decreased client satisfaction and delayed project delivery caused by continued understaffing when hired employees renege.
An organization could increase hiring in response to a high renege, but this likewise has undesirable consequences. Primarily, even with a high renege rate, it is currently difficult for an organization to predict accurately the particular candidates that will renege. Effectively, an organization would need to over-hire with expectation that at least some of the hired employees would not join. While this method may work where employees have interchangeable job skills, many jobs positions require particular skills such that only particular individuals can perform the requisite tasks.
Currently, there are no available systems or methods directed toward predicting a renege rate. Specifically, no known hiring tools or methods address the issue of identifying candidates that are likely to renege acceptance of job offers.
Moreover, no current tools or methodology exist to assist an organization in identifying factors that are specific to a position or organization and that significantly impact the renege rate. Consequently, organizations are left with little guidance in selecting a course of action to address high renege rates.